Anyone who still thinks social networking is a silly business is delusional. Let's review:
- Twitter is valued at $1 billion and turned a 2009 profit thanks to search deals with Google
(NASDAQ:GOOG)and Microsoft (NASDAQ:MSFT), BusinessWeek reports.
- LinkedIn, also valued at $1 billion, has opened its platform to third-party developers and remains a favorite of Silicon Valley's top venture capitalists.
Foursquare has attracted 250,000 users in less than a year and can be found on Apple's
(NASDAQ:AAPL)iPhone, Google's Android, Palm's (NASDAQ:PALM)Pre, and, most recently, Research In Motion's (NASDAQ:RIMM)BlackBerry.
And now Facebook, the biggest social network with 350 million global users, announced on Thursday in a blog post that it's ready to build its own data center. Media reports place the cost of the facility at $188.2 million.
The data on data centers
You have to know a little about data centers to understand how big this news is. Most look like nondescript warehouses from the outside, yet inside they house thousands of servers in rooms air-conditioned to a noticeable chill. "Expensive" is almost too tame a word to describe the money and time that goes into building a data center.
Facebook wouldn't even try to build one if it didn't need the processing horsepower to manage the explosive growth of its platform. And yet, interestingly, the company isn't just building a data center.
Facebook also says it will use clean techniques to reduce energy consumption, including recycling heat from servers to supply warm air during cold months. Outside air and evaporated water will provide cooling the rest of the year. The goal? Reduce the environmental impact of the new facility, which is being built in Prineville, Ore.
Mr. Market, panting for more
The IPO market beckons for aggressive growth like this. It's why Facebook is on every hot prospect list I've seen over the past few months.
There's just one problem: Facebook's capital needs and reported $11 billion existing valuation are going to demand a premium exit -- possibly more than the largest U.S. stock debut of all time, Visa
But that's also just my take. Now it's your turn to weigh in. What value do you assign to Facebook? Should it go public, or remain private? Make your voice heard using the comments box below.
Apple is a Motley Fool Stock Advisor selection. Google is a Motley Fool Rule Breakers recommendation. Microsoft is a Motley Fool Inside Value pick. Motley Fool Options has recommended a diagonal call strategy on Microsoft. Try any of our Foolish newsletter services free for 30 days.
At times, Fool contributor Tim Beyers is too social for his own good. He had stock and options positions in Apple and a stock position in Google at the time of publication. Check out Tim's portfolio holdings and Foolish writings, or connect with him on Twitter as @milehighfool. The Motley Fool is also on Twitter as @TheMotleyFool. The Fool's disclosure policy would put its name in as host for ABC's This Week, but lost its voice last week.
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